The manager has been Chief Financial Officer of JP Morgan Chase’s Consumer & Community Banking division since 2016.
(Photo: IMF / Twitter)
Zurich UBS is getting a new head of finance. Sarah Youngwood will take over the position of Group Chief Financial Officer (CFO) from Kirt Gardner in May next year. The largest Swiss bank announced on Wednesday. She will join the UBS Executive Committee as early as March.
The manager has been Chief Financial Officer of JP Morgan Chase’s Consumer & Community Banking division since 2016. It is the largest division of the US bank in terms of sales. Since 2020, Youngwood has also been responsible for the finances of the global technology unit of the US institute, said UBS. You have French and US citizenship.
Gardner has decided to quit his job and leave the bank. The manager, who has been with the institute since 2013 and has been its chief financial officer since 2016, will work closely with Youngwood to ensure a smooth transition.
“Thanks to her strong track record, her extensive financial knowledge and her experience in various banking areas, Sarah is ideally equipped to lead the finance department into the future,” said UBS CEO Ralph Hamers, while at the same time thanking Gardner for his commitment: “He was instrumental in this ensured that our company continued to build up its financial strength and that the trust of customers and investors remained unbroken in various market situations. “
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The personnel is a further signal that Hamers wants to make the top management of UBS more technology-savvy and more feminine. In spring he appointed Mike Dragan, a chief digital officer, to the board for the first time. The chief lawyer Barbara Levi had poached Hamers from the mining company Rio Tinto.
Expertise from the American financial sector
Youngwood’s signing is also a sign that UBS sees US banks as the main competitor it wants to catch up with. UBS recently arranged the successor to the head of the Board of Directors, also relying on the expertise of the American financial sector. At the Annual General Meeting in April 2022, Irishman Colm Kelleher, a former top manager of the US investment bank Morgan Stanley, is to be elected as the successor to long-time President Axel Weber.
It will be an important task for Youngwood in the future to convince the shareholders of the big bank that the valuation discount of UBS compared to the US competition is not justified. UBS is currently worth around 60 billion francs (around 65 billion dollars). Morgan Stanley comes to $ 170 billion. Youngwood is therefore likely to want to lure shareholders with rising dividends and share buyback programs.
In any case, UBS has enough capital that can be distributed to shareholders: Youngwood’s predecessor Gardener left behind an extremely solid balance sheet. The major Swiss bank has an equity ratio of 14.5 percent – significantly more than required by the financial regulator. At the same time, UBS generates billions in profits every quarter, most recently net profit was 2.3 billion US dollars in the third quarter of 2021.
The expectations of the analysts are also high: For example, Bank of America analyst Alastair Ryan recently raised his price target for UBS to 18.60 francs per share, a surcharge of 15 percent on the current price. The analyst expects earnings per share to grow by four percent through 2023. “Rising interest rates offer further upside potential,” says Ryan.
UBS boss Hamers wants to present an update of his strategy in February next year. He is expected to explain his plans for digitizing the bank and the growth strategy in America, the most important market, in more detail.
Youngwood knows its way around both IT budgets and the US market. She should therefore play an important role in Hamer’s management team in the future.
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